A confidential draft United Nations blacklist seen by Reuters on Tuesday names a Saudi Arabia-led military coalition for killing and maiming children in Yemen, though it notes that the alliance has put in place measures to improve child protection.

In an effort to dampen controversy surrounding the annual children and armed conflict report, the draft blacklist - contained in an annex to the full report - is split into "listed parties that have put in place measures during the reporting period to improve the protection of children" and those which have not.

"In Yemen, the coalition's actions objectively led to the listing for the killing and maiming of children, with 683 child casualties attributed to this party, and, as a result of being responsible for 38 verified incidents, for attacks on schools and hospitals during 2016," according to a draft explanation of the blacklist seen by Reuters.

Protest against the Saudi coalition in front of the UN offices in Sanaa, 29 August (Reuters)

"The coalition is included in section B of Annex I, as it has put in place measures during the reporting period aimed at improving the protection of children," the draft said.

The draft UN annex blacklists the Houthis, Yemen government forces, pro-government militia and al-Qaeda in the Arabian Peninsula for violations against children in 2016 as it did in last year's report covering violations in 2015.

The draft report has to be approved by UN Secretary-General Antonio Guterres and is subject to change. It is due to be submitted to the UN Security Council this month, and the 15-member body is to discuss the report on 31 October.

The Saudi UN ambassador, Abdallah Al-Mouallimi, declined to comment until the report is officially issued. In August, the Saudi UN mission said there was "no justification whatsoever" for including the coalition on the blacklist.

UN spokesman Stephane Dujarric said the United Nations does not comment on leaked documents.

The coalition was briefly added to the blacklist last year and then removed by then-UN chief Ban Ki-moon pending review. At the time, Ban accused Saudi Arabia of exerting "unacceptable" undue pressure after sources told Reuters that Riyadh threatened to cut its UN funding. Saudi Arabia denied threatening Ban.

The report - produced by UN children and armed conflict envoy Virginia Gamba and issued in Guterres' name - does not subject those listed to any UN action, but rather shames parties to conflicts in the hope of pushing them to implement measures to protect children.

The Saudi-led coalition began a military campaign in Yemen in March 2015 with the aim of preventing Iran-allied Houthi rebels and forces loyal to Yemen's ex-President Ali Abdullah Saleh from taking power.

An earlier draft of the latest annual report, which covers 2016 and was seen by Reuters in August, said that of the 683 child casualties blamed on the Saudi-led coalition, about half of those were killed and the rest injured.

That earlier draft said the Houthi rebels and affiliated forces were responsible for nearly a third of the total 1,340 child casualties verified by the United Nations.

The annual children and armed conflict report is produced at the request of the UN Security Council.

In 2015 the United Nations left Israel and Hamas off the blacklist, after they had been included in an earlier draft, but criticised Israel over its 2014 military operations.

Separately, the Geneva-based UN Human Rights Council agreed on Friday to set up a panel to examine all alleged human rights violations committed in Yemen's war and identify those responsible.

UN human rights chief Zeid Raad al-Hussein had long-pleaded with the 47-member Human Rights Council to launch an independent investigation into the war, which has killed thousands, ruined the economy and pushed millions to the brink of famine.